According to new statistics from TransUnion, student loan delinquencies have fallen in the first quarter, yet have increased year-over-year. More specifically, 30-day student loan delinquency rates dropped to 6.6 percent from 8.06 percent in third quarter 2009; however, year-over-year for the fourth quarter, 30- and 90-day delinquency rates are up from 2008 to 10.4 percent and 11.67 percent, respectively.
Additional Statistics from TransUnion
In an overall analysis of the student lending industry, TransUnion looked at statistics in a variety of areas, but most in the area of private student loans. Here are some numbers the company came up with:
- Private student loan delinquencies increased: According to TransUnion, the delinquencies of private student loans decreased approximately 4.9 percent, down from a high of 6.34 percent in third quarter 2009.
- Average private student loan amounts: The average national private student loan debt for the fourth quarter 2009 was $17,754, while the average delinquent amount for these types of loans was $13,033.
- States with most private student loans: The states that have the most private loans out right now are California, Texas, New York, New Jersey and Minnesota, which as a whole represent 38 percent of all new loans in the country.
Highest/Lowest Private Student Loan Delinquencies by State
The report noted that approximately 20 percent of student loans are considered private. Here is a short list of the states with the highest and lowest private student loan delinquencies:
- Florida: 9.44 percent
- Mississippi: 9.09 percent
- Tennessee: 9.07 percent
The lowest include:
- Vermont: 3.28 percent
- New Hampshire: 3.60 percent
- North Dakota: 3.75 percent
Will Student Loan Reform Reduce Delinquencies?
Since the delinquencies for both student loans and private student loans have seen year-over-year increases, it seems that students are still struggling to repay their loans. One has to wonder whether student loan reform will play a role in taming the delinquency roller coaster.
One change in reform just may help. This is the income-based loan repayment program, which will lower the cap on the payment students are expected to make from 15 percent to 10 percent of their income up to 150 percent of the poverty level. However, this isn’t set to take effect until 2014.
There is another consideration in Congress that could help those who take out private student loans though. Congress is considering adding private loans as a dischargeability option in bankruptcy. If this occurs, students with private loans will be able to eliminate their debt in a bankruptcy proceeding, which in turn could help the delinquency issue.
In the meantime, however, students will have to figure out how to reduce their own student loan debt. If you’re in need of help, here are some tips to consider.
